********************************************************
NOTICE
********************************************************
This document was converted from Microsoft Word.
Content from the original version of the document such as
headers, footers, footnotes, endnotes, graphics, and page numbers
will not show up in this text version.
All text attributes such as bold, italic, underlining, etc. from the
original document will not show up in this text version.
Features of the original document layout such as
columns, tables, line and letter spacing, pagination, and margins
will not be preserved in the text version.
If you need the complete document, download the
Microsoft Word or Adobe Acrobat version.
*****************************************************************
Before the
Federal Communications Commission
Washington, D.C. 20554
)
) File No. EB-09-SE-152
In the Matter of
) NAL/Acct. No. 201032100007
Apple, Inc.
) FRN 0005899216
)
Notice of apparent Liability for forfeiture
Adopted: November 30, 2009 Released: December 2, 2009
By the Chief, Spectrum Enforcement Division, Enforcement Bureau:
I. introduction
1. In this Notice of Apparent Liability for Forfeiture ("NAL"), we find
that Apple, Inc. ("Apple") apparently willfully violated the wireless
handset hearing aid compatibility status report filing requirements
set forth in Section 20.19(i)(1) of the Commission's Rules ("Rules").
For this apparent violation, we propose a forfeiture in the amount of
five thousand dollars ($5,000).
II. BACKGROUND
2. In the 2003 Hearing Aid Compatibility Order, the Commission adopted
several measures to enhance the ability of individuals with hearing
disabilities to access digital wireless telecommunications. The
Commission established technical standards that digital wireless
handsets must meet to be considered compatible with hearing aids
operating in acoustic coupling and inductive coupling (telecoil)
modes. The Commission further established, for each standard,
deadlines by which manufacturers and service providers were required
to offer specified numbers or percentages of digital wireless
handsets per air interface that are compliant with the relevant
standard if they did not come under the de minimis exception. In
February 2008, as part of a comprehensive reconsideration of the
effectiveness of the hearing aid compatibility rules, the Commission
released an order that, among other things, adopted new compatible
handset deployment benchmarks beginning in 2008.
3. In order to monitor the availability of these handsets, the
Commission initially required manufacturers and digital wireless
service providers to report every six months on efforts toward
compliance with the hearing aid compatibility requirements for the
first three years of implementation (May 17, 2004, November 17, 2004,
May 17, 2005, November 17, 2005, May 17, 2006 and November 17, 2006),
and then annually thereafter through the fifth year of implementation
(November 19, 2007 and November 17, 2008). In its 2008 Hearing Aid
Compatibility First Report and Order, the Commission extended these
reporting requirements with certain modifications on an open ended
basis, beginning January 15, 2009. The Commission also made clear
that these reporting requirements apply to carriers that fit within
the de minimus exception.
4. Apple failed to timely file the required report for the period July
1, 2008 through December 31, 2008, filing it on June 3, 2009, nearly
five months after the deadline of January 15, 2009. Apple timely
filed the required report for the period January 1, 2009 through June
30, 2009 on July 15, 2009. On September 16, 2009, the Wireless
Telecommunications Bureau ("WTB") referred Apple's apparent violation
of the hearing aid compatibility reporting requirements to the
Enforcement Bureau for action.
III. DISCUSSION
A. Failure to File Timely Hearing Aid Compatibility Status Report
5. Section 20.19(i)(1) of the Rules requires handset manufacturers to
file hearing aid compatibility status reports under revised rules
initially on January 15, 2009 (covering the six month period ending
December 31, 2008) and then annually beginning July 15, 2009. Apple
did not file the report covering the six month period ending December
31, 2008 until June 3, 2009, nearly 5 months after the January 15,
2009 due date. Accordingly, we find that Apple failed to timely file
the hearing aid compatibility status report in apparent willful
violation of the requirements set forth in Section 20.19(i)(1) of the
Rules.
B. Proposed Forfeiture
6. Under Section 503(b)(1)(B) of the Act, any person who is determined
by the Commission to have willfully or repeatedly failed to comply
with any provision of the Act or any rule, regulation, or order
issued by the Commission shall be liable to the United States for a
forfeiture penalty. To impose such a forfeiture penalty, the
Commission must issue a notice of apparent liability and the person
against whom such notice has been issued must have an opportunity to
show, in writing, why no such forfeiture penalty should be imposed.
The Commission will then issue a forfeiture if it finds by a
preponderance of the evidence that the person has violated the Act or
a Commission rule. We conclude under this standard that Apple is
apparently liable for forfeiture for its failure to timely file the
required hearing aid compatibility status report in apparent willful
violation of the requirements set forth in Section 20.19(i)(1) of the
Rules.
7. The Commission's Forfeiture Policy Statement and Section 1.80(b) of
the Rules set a base forfeiture amount of $3,000 for the failure to
file required forms or information. While the base forfeiture
requirements are guidelines lending some predictability to the
forfeiture process, the Commission retains the discretion to depart
from these guidelines and issue forfeitures on a case-by-case basis,
under its general forfeiture authority contained in Section 503 of
the Act. In exercising such discretion, we are required to take into
account "the nature, circumstances, extent, and gravity of the
violation and, with respect to the violator, the degree of
culpability, any history of prior offenses, ability to pay, and such
other matters as justice may require."
8. In the American Samoa Telecommunications Authority NAL, we found that
the status reports are essential to the implementation and
enforcement of the hearing aid compatibility rules. The Commission
relies on these reports to provide consumers with information
regarding the technical specifications and commercial availability of
hearing aid-compatible digital wireless handsets and to hold the
digital wireless industry accountable to the increasing number of
hearing-impaired individuals. We noted that when setting an $8,000
base forfeiture for violations of the hearing aid-compatible handset
labeling requirements, the Commission emphasized that individuals
with hearing impairments could only take advantage of critically
important public safety benefits of digital wireless services if they
had access to accurate information regarding hearing aid
compatibility features of handsets. We also noted that the Commission
has upwardly adjusted the base forfeiture when noncompliance with
filing requirements interferes with the accurate administration and
enforcement of Commission rules. Because the failure to file hearing
aid compatibility status reports implicates similar public safety and
enforcement concerns, we exercised our discretionary authority and
established a base forfeiture amount of $6,000 for failure to file
hearing aid compatibility reports. Consistent with ASTCA, we will
apply the same base forfeiture amount here.
9. Apple's failure to file the report on time had an adverse impact on
the Commission's ability to ensure the commercial availability of
hearing aid-compatible digital wireless handsets. We find, however,
that downward adjustment to the $6,000 base forfeiture amount to
$5,000 is warranted based on Apple's demonstrated good faith effort.
Although Apple failed to timely file the January Status Report, it
did file the report prior to the commencement of an investigation by
the Commission. Accordingly, we propose a forfeiture of $5,000
against Apple for apparently willfully failing to timely file its
January 15, 2009 hearing aid compatibility status report in violation
of Section 20.19(i)(1) of the Rules.
IV. ORDERING clauses
10. Accordingly, IT IS ORDERED that, pursuant to Section 503(b) of the
Act, and Section 1.80 of the Rules, Apple, Inc. IS NOTIFIED of its
APPARENT LIABILITY FOR A FORFEITURE in the amount of five thousand
dollars ($5,000) for failing to file its hearing aid compatibility
status report in apparent willful violation of the requirements set
forth in Section 20.19(i)(1) of the Rules.
11. IT IS FURTHER ORDERED that, pursuant to Section 1.80 of the Rules,
within thirty days of the release date of this Notice of Apparent
Liability for Forfeiture, Apple, Inc. SHALL PAY the full amount of
the proposed forfeiture or SHALL FILE a written statement seeking
reduction or cancellation of the proposed forfeiture.
12. Payment of the forfeiture must be made by check or similar
instrument, payable to the order of the Federal Communications
Commission. The payment must include the NAL/Account Number and FRN
Number referenced above. Payment by check or money order may be
mailed to Federal Communications Commission, P.O. Box 979088, St.
Louis, MO 63197-9000. Payment by overnight mail may be sent to U.S.
Bank - Government Lockbox #979088, SL-MO-C2-GL, 1005 Convention
Plaza, St. Louis, MO 63101. Payment by wire transfer may be made to
ABA Number 021030004, receiving bank TREAS/NYC, and account number
27000001. For payment by credit card, an FCC Form 159 (Remittance
Advice) must be submitted. When completing the FCC Form 159, enter
the NAL/Account number in block number 23A (call sign/other ID), and
enter the letters "FORF" in block number 24A (payment type code).
Requests for full payment under an installment plan should be sent
to: Chief Financial Officer -- Financial Operations, 445 12th Street,
S.W., Room 1-A625, Washington, D.C. 20554. Please contact the
Financial Operations Group Help Desk at 1-877-480-3201 or Email:
ARINQUIRIES@fcc.gov with any questions regarding payment procedures.
Apple will also send electronic notification on the date said payment
is made to Linda.Nagel@fcc.gov and Kathy.Berthot@fcc.gov.
13. The response, if any, must be mailed to the Office of the Secretary,
Federal Communications Commission, 445 12th Street, S.W., Washington,
D.C. 20554, ATTN: Enforcement Bureau - Spectrum Enforcement Division,
and must include the NAL/Acct. No. referenced in the caption. The
response should also be emailed to Kathryn Berthot at
Kathy.Berthot@fcc.gov and Linda Nagel at Linda.Nagel@fcc.gov.
14. The Commission will not consider reducing or canceling a forfeiture
in response to a claim of inability to pay unless the petitioner
submits: (1) federal tax returns for the most recent three-year
period; (2) financial statements prepared according to generally
accepted accounting practices; or (3) some other reliable and
objective documentation that accurately reflects the petitioner's
current financial status. Any claim of inability to pay must
specifically identify the basis for the claim by reference to the
financial documentation submitted.
15. IT IS FURTHER ORDERED that a copy of this Notice of Apparent
Liability for Forfeiture shall be sent by first class mail and
certified mail return receipt requested to Robert Steinfeld, Apple,
Inc., 1 Infinite Loop, Mail Stop 26A, Cupertino, CA 95014 and to
counsel for Apple, Inc., Paul Margie, Esq., Wiltshire & Grannis LLP,
1200 Eighteenth St. NW, Suite 1200, Washington, DC 20036-2056.
FEDERAL COMMUNICATIONS COMMISSION
Kathryn S. Berthot
Chief, Spectrum Enforcement Division
Enforcement Bureau
47 C.F.R. S: 20.19(i)(1).
The Commission adopted these requirements for digital wireless telephones
under the authority of the Hearing Aid Compatibility Act of 1988, codified
at Section 710(b)(2)(C) of the Communications Act of 1934, as amended, 47
U.S.C. S: 610(b)(2)(C). See Section 68.4(a) of the Commission's Rules
Governing Hearing Aid-Compatible Telephones, Report and Order, 18 FCC Rcd
16753, 16787 P: 89 (2003); Erratum, 18 FCC Rcd 18047 (2003) ("Hearing Aid
Compatibility Order"); Order on Reconsideration and Further Notice of
Proposed Rulemaking, 20 FCC Rcd 11221 (2005) ("Hearing Aid Compatibility
Reconsideration Order").
See Hearing Aid Compatibility Order, 18 FCC Rcd at 16777 P: 56; 47 C.F.R.
S:S: 20.19(b)(1) and (2).
The term "air interface" refers to the technical protocol that ensures
compatibility between mobile radio service equipment, such as handsets,
and the service provider's base stations. Currently, the leading air
interfaces include Code Division Multiple Access (CDMA), Global System for
Mobile Communications (GSM), Integrated Dispatch Enhanced Network (iDEN)
and Wideband Code Division Multiple Access (WCDMA) a/k/a Universal Mobile
Telecommunications System (UMTS).
See Hearing Aid Compatibility Order, 18 FCC Rcd at 16780 P: 65; 47 C.F.R.
S:S: 20.19(c), (d). The de minimis exception provides that manufacturers
or mobile service providers that offer two or fewer digital wireless
handset models per air interface are exempt from the hearing aid
compatibility deployment requirements, and manufacturers or mobile service
providers that offer three digital wireless handset models per air
interface must offer at least one compliant model. 47 C.F.R. S: 20.19(e).
See Amendment of the Commission's Rules Governing Hearing Aid-Compatible
Mobile Handsets, First Report and Order, 23 FCC Rcd 3406 (2008) ("Hearing
Aid Compatibility First Report and Order"), Order on Reconsideration and
Erratum, 23 FCC Rcd 7249 (2008).
Hearing Aid Compatibility Order, 18 FCC Rcd at 16787 P: 89; see also
Wireless Telecommunications Bureau Announces Hearing Aid Compatibility
Reporting Dates for Wireless Carriers and Handset Manufacturers, Public
Notice, 19 FCC Rcd 4097 (Wireless Tel. Bur. 2004).
See Hearing Compatibility First Report and Order, 23 FCC Rcd at 3445-46
P:P: 97-99.
Id. at P: 99.
See Apple, Inc. Hearing Aid Compatibility Status Report, Docket No. 07-250
(June 3, 2009) ("January Status Report").
See Apple, Inc. Hearing Aid Compatibility Status Report, Confirmation No.
0003901720 ("July Status Report").
47 C.F.R. S: 20.19(i)(1).
See January Status Report.
Section 312(f)(1) of the Act defines "willful" as "the conscious and
deliberate commission or omission of [any] act, irrespective of any intent
to violate" the law. 47 U.S.C. S: 312(f)(1). The legislative history of
Section 312(f)(1) of the Act clarifies that this definition of willful
applies to both Sections 312 and 503(b) of the Act, H.R. Rep. No. 97-765,
97th Cong. 2d Sess. 51 (1982), and the Commission has so interpreted the
term in the Section 503(b) context. See Southern California Broadcasting
Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388 P: 5 (1991),
recon. denied, 7 FCC Rcd 3454 (1992) ("Southern California").
47 C.F.R. S: 20.19(i)(1).
47 U.S.C. S: 503(b)(1)(B); 47 C.F.R. S: 1.80(a)(1).
47 U.S.C. S: 503(b); 47 C.F.R. S: 1.80(f).
See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC Rcd 7589,
7591 P: 4 (2002).
47 C.F.R. S: 20.19(i)(1).
47 C.F.R. S: 1.80(b).
See Forfeiture Policy Statement, 12 FCC Rcd at 17099 P: 22, 17101 P: 29.
See also 47 C.F.R. S:1.80(b)(4) ("The Commission and its staff may use
these guidelines in particular cases [, and] retain the discretion to
issue a higher or lower forfeiture than provided in the guidelines, to
issue no forfeiture at all, or to apply alternative or additional
sanctions as permitted by the statute.") (emphasis added).
47 U.S.C. S: 503(b)(2)(E). See also 47 C.F.R. S: 1.80(b)(4), Note to
paragraph (b)(4): Section II. Adjustment Criteria for Section 503
Forfeitures.
See American Samoa Telecommunications Authority, Notice of Apparent
Liability for Forfeiture, 23 FCC Rcd 16432 (Enf. Bur., Spectrum Enf. Div.
2008), response received ("ASTCA NAL").
See ASTCA NAL, 23 FCC Rcd at 16436-47 P: 10.
Id.
Id.
Id.
47 C.F.R. S: 20.19(i)(1).
Id.
(Continued from previous page ...)
(continued ...)
Federal Communications Commission DA 09-2507
2
Federal Communications Commission DA 09-2507